More sanctions on Iran unlikely to impact world gas market

More sanctions on Iran unlikely to impact world gas market

Further sanctions on Iran are unlikely to have a major impact on the world gas market, an analyst at a Singapore-based think-tank told Trend news agency. James Dorsey, a Senior Fellow at the S. Rajaratnam School of International Studies (RSIS) of the Nanyang Technological University, was commenting on a possibility of EU imposing a ban on Iran’s gas exports.

Iran, which has the world’s second biggest natural gas reserves after Russia, is already suffering from international sanctions that have impacted its oil exports. “Iran is already finding it difficult to export and many of its clients have sought alternative suppliers,” Dorsey said.

The European Union is poised to ban imports of Iranian gas into Europe as part of its efforts to ratchet up pressure on the Islamic Republic over its nuclear program, diplomats said on Thursday, Reuters reported.

Diplomats from EU member states have started preparing a package of sanctions against Iran with a goal of formally adopting them at a meeting of foreign ministers on Oct. 15 in Luxembourg. Late on Wednesday, they reached a preliminary deal to ban gas imports, the first measure to win approval in the package, which also consists of various finance and energy-related proposals, three EU diplomats said.

“There is agreement on gas,” one of the diplomats said, speaking on condition of anonymity. “The big states back it, Germany, Britain, France,” another one said.

The moves come as European governments and the United States are searching for new ways to pressure Tehran into scaling back its nuclear work after diplomacy foundered earlier this year. Tehran denies its work has any military intentions.

The United States, since 1995, has banned U.S. firms from investing in Iranian oil and gas and from trading with Iran.

The European Union has been much slower to ban Iranian energy. It imposed an embargo on Iranian oil this year, after banning the creation of joint ventures with enterprises in Iran engaged in the oil and natural gas industries in 2010.

Existing sanctions cover investment in Iranian gas, but do not specifically outlaw imports, which are insignificant in terms of volume, but symbolic. The EU sources said Iranian crude reaches Europe via Turkey, and it is shipped on from there.

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